Oil prices continued to grow on Friday, as the International Energy Agency (IEA) said that global crude demand would return to pre-Covid-19 pandemic levels by the end of next year.
Global benchmark Brent rose to $72.87 a barrel, while West Texas Intermediate crude (WTI) for July delivery increased to $70.72. WTI topped $70 a barrel last Friday (its highest since 2018), and Brent spiked over $72 on increasingly favorable demand outlook.
The IEA said in a report on Friday that producers will need to increase output to keep up with demand recovery. It expects demand to rise in 2021 before growing at a faster rate next year, reaching 100 million barrels a day (mb/d) by the end of 2022.
According to the energy agency, there’s scope for the Organization of the Petroleum Exporting Countries and its allies (OPEC+) to boost production by 1.4 mb/d above its July 2021 to March 2022 target.
“Our first detailed look at 2022 balances confirms earlier expectations that OPEC+ needs to open the taps to keep the world oil markets adequately supplied,” IEA said.
Earlier this month, OPEC+ producers agreed to stick with the current plan to gradually increase oil output through July in place. The decision has sent crude oil futures to their highest marks in more than two years.
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